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Websites Play Important Role in Disclosing Company Information

Editor’s Note: This article is the first in a two-part series. Part two, appearing in the May 2014 issue, will address strategies manufacturers and resellers can use to improve communication via their websites.

Over the course of the past 20 years, the window and door industry has moved from a predominantly “business-to-business” model to more of a “business-to-consumer” model, especially in regard to marketing programs and advertising materials. This shift has placed manufacturers and resellers in a different position legally with respect to product exposure. The pace of that legal change has been slow, easy to miss, but inexorable. The cumulative effect is now dramatic.

During this same period, not only has technology changed how we communicate with potential consumers, it also has raised the legal expectations surrounding that communication.

Mind the Knowledge Gap

In the not-so-distant past, a manufacturer could largely count on industry “custom and practice” to establish enforceable norms relating to sales transactions and overall product characteristics. In other words, in the face of a legal challenge, the ability to establish compliance with standard industry methods of operation and industry terms was a prime component for a solid defense. This was generally fair as professionals in the industry had the opportunity, if not the obligation, to know how things worked.

By reaching consumers directly through marketing and advertising—possibly bypassing professional building and remodeling purchasers—manufacturers seek to influence homeowners who do not understand the inner workings and reasonable expectations of the industry. With this knowledge gap, the use of industry “custom and practice” becomes more of a challenge. An important question is whether the consumer has reason to believe that there may be conditions affecting his or her rights that they can reasonably access in advance of their purchase decision.

Transparency Needed

Over time, the American public has lost trust in government, financial markets and, sadly, the world of collective “business” upon which most of us rely. A more dissatisfied, litigious American society has emerged. Those industries that earlier made the jump from B-to-B to B-to-C marketing and communication (e.g., pharmaceuticals) have faced enhanced legal demands for years. Today, they provide consumers greater transparency with regard to communication of relevant detail. Failure to do so has proved perilous. While I am not suggesting that the window and door industry represents a market as unforgiving as the pharmaceutical industry, it’s folly to not take steps to provide information and become more “transparent” to consumers.

The Role of the Company Website

Bill Gates referenced “asynchronous communication” in his book The Road Ahead. He refers to this as a method of communication made possible by evolving electronic-based communication systems (e.g. email) in which the “speaker” need not be contemporaneously in touch with the recipient. In a way, the law has long recognized asynchronous communication. For example, a written contract may be enforceable even though it is prepared and delivered weeks before it is later signed by the other party.

Today, manufacturers and resellers can effectively use a company website to provide this type of communication. While there is no promise that an individual judge will charge a given consumer with knowledge of a company’s website content, it seems clear that the law’s recognition of the effort to communicate with consumers via the web already exists and will only grow. This is particularly true if related marketing, advertising and purchase-related documentation references the web-based material. A good indication of this is found in Energy Star Version 6.0, which explicitly provides that product installation instructions may be provided by reference to website material.

This, then, is the issue. Informing end users of your company’s applicable “customs and practices” requires a thoughtful and coordinated effort within your firm.

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Paul Gary is an attorney at the Gary Law Group, a Portland, Ore., based firm that specializes in legal services for the window and door industry. Write Gary at paul@prgarylaw.com.